October 1, 2012

Accepting Credit Cards Is About to Get Cheaper and Easier

Starbucks and Square, a credit transaction
company, have completed an agreement that is going to allow consumers to make
purchases without having to take out their wallets. Here is how The New York Times describes it
in a column by Farhad Manjoo, “Silicon Valley’s Next Great Company:”

In August, Square
announced that, beginning this fall, it will
process all credit card payments at Starbucks stores. When the system is fully
up and running, customers will be able to shop at Starbucks just by saying their
names: After you opt in, your name and photo will pop up on
the Starbucks cashier’s screen when you enter the store with your phone in your
pocket. To pay, you’ll just tell the cashier to put it on your tab. That’s
it—you don’t have to remove your phone or swipe or sign anything.

Manjoo thinks that Square is on to something really
big. You probably know Square from those
commercials where a small retailer takes credit card transactions by attaching
a cube like device to a cell phone. That
is cool in itself but on top of that, Square is lowering the cost of taking
credit cards to a

fixed monthly fee of $275 per month. Again, here is how Manjoo quotes Square COO
Keith Rabois: “There is no longer any excuse for an American business to not
accept credit cards today—they're handicapping their own sales and profits if
they don’t, and their customers will be happier if they do.”

I think this has huge potential to increase sales and reduce costs. Check out the Square website and let us know your thoughts.